Don't file your next Vat return until you read this urgent message!
Derek, one of our Accounting and Tax Club members recently had R150 000 swiped out of his bank account by SARS!
He filed his Vat return and claimed R30 000 input tax. But, this time, he triggered SARS' Review of VAT201 declaration letter.
And he didn't respond to it. So SARS helped itself to his bank account. It not only took the R30 000 input tax, but added 200% penalties plus interest which came to R120 000. That's a total of R150 000 gone from his company's bank account! All without warning.
Don't make the same mistake Derek made. Read on to find out what triggers to avoid when you next file your Vat return, and how to save money...
Can you really afford not to be 100% sure about every input tax claim you submit?
• Claiming less money than you should; or
• Claiming more money than you should, and getting a black mark from SARS plus penalties and interest!
You could be the reason you receive a 'Review of VAT201 Declaration letter' from SARS
If you haven't received this letter before, generally you will when your Vat return differs from other tax periods.
This is the mistake Derek made. He filled in a block on his Vat return which he never uses.
You see, if you insert an amount into one of the blocks (output or input) you don't usually use, it will trigger an alarm bell at SARS.
Such instances can include filling in:
• Block 3 for exempt supplies;
• Block 12 for adjustments;
• Block 17 for bad debts; and/or
• Block 18 for adjustments.
These are all blocks that in general, you'd seldom use, if at all.
Always make sure you complete your Vat return correctly and put the correct amounts in the correct blocks as allocated.
But it's not as simple as that, read on to find out what Derek's next mistake was…
Your chances of being audited by SARS just increased…
A small administrative mistake is all it takes for SARS to schedule an audit for your business.
Putting a simple zero in the wrong place on the Vat return could cause a long and tedious audit process that could cost your business thousands.
Make sure this never happens to you by filling in the Vat return 100% correctly every, single time.
If you ignore the SARS' letter, you're opening yourself up to an audit!
When you ignore SARS' letter, or don't respond, SARS will take it as if you agree with its audit and assessment.
So in Derek's case, SARS reversed his input tax deduction. His output tax suddenly became payable and SARS raised penalties for late payments and for claiming Vat when he shouldn't have.
And, just helped itself to his business bank account!
If Derek had this eReport he could've saved himself the R150 000 and received his R30 000 input tax.
At the 2015 Vat Masterclass Dee will show you the four triggers of this dreaded SARS Vat pop-up letter and how to avoid them. Plus she'll show you how to deal with it correctly when you receive it. But hurry, seats are filling up fast… Click here to secure your seat now!